Correlation Between Direxion Daily and Story

Can any of the company-specific risk be diversified away by investing in both Direxion Daily and Story at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Direxion Daily and Story into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Direxion Daily Semiconductor and Story, you can compare the effects of market volatilities on Direxion Daily and Story and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Direxion Daily with a short position of Story. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and Story.

Diversification Opportunities for Direxion Daily and Story

0.02

Correlation Coefficient

Direxion Daily  Story

Significant diversification

The 3 months correlation between Direxion and Story is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Semiconductor and Story in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Story and Direxion Daily is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Direxion Daily Semiconductor are associated (or correlated) with Story. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Story has no effect on the direction of Direxion Daily i.e., Direxion Daily and Story go up and down completely randomly.

Pair Corralation between Direxion Daily and Story

Given the investment horizon of 90 days Direxion Daily Semiconductor is expected to under-perform the Story. But the etf apears to be less risky and, when comparing its historical volatility, Direxion Daily Semiconductor is 1.37 times less risky than Story. The etf trades about -0.22 of its potential returns per unit of risk. The Story is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  365.00  in Story on May 5, 2025 and sell it today you would earn a total of  221.00  from holding Story or generate 60.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

Direxion Daily Semiconductor  vs.  Story

Direxion Daily Semic

Risk-Adjusted Performance

Very Weak

Over the last 90 days Direxion Daily Semiconductor has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in September 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

Story

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Story are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Story exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Direxion Daily and Story

The main advantage of trading using opposite Direxion Daily and Story positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, Story can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Story will offset losses from the drop in Story's long position.

The idea behind Direxion Daily Semiconductor and Story pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.